According to CryptoPotato, CryptoQuant's head of research, Julio Moreno, reported on Aug. 6 that the firm's 'Bull-Bear Market Cycle Indicator' has signaled a bear phase for the first time since January 2023. This follows a significant market downturn that saw approximately $500 billion wiped out in less than a week. Despite this, there is no immediate cause for alarm as the indicator has previously flashed bear warnings during bull market cycles that eventually reached all-time highs.
The Bull-Bear Market Cycle Indicator has flagged bear phases during notable events such as the COVID-19 sell-off in March 2020 and the Chinese crypto mining ban in May 2021. It also accurately predicted the start of the bear market at the cycle peak in November 2021. While many altcoins remain in a bear market, Bitcoin is currently just 22.5% away from its all-time high, which suggests a less bearish outlook.
Analysts are divided on the current market conditions. Crypto trader 'Philakone' expressed to his 148,000 followers on X that there is a 25% chance Bitcoin has reached its cycle peak and a major correction is imminent, potentially leading to a bear market with targets between $25,000 and $30,000. Conversely, technical analyst 'Titan of Crypto' argued that the bull market persists, referencing the 38.2% Fibonacci retracement level as a key metric. As long as Bitcoin's price closes above this level, the bull market is considered ongoing.
The crypto market has shown some recovery from the recent downturn, with total capitalization reclaiming $2.1 trillion. Bitcoin prices reached $57,000 on Aug. 6, marking a 14% gain from the previous day's low below $50,000. Currently, Bitcoin trades up 2.6% on the day, just below $57,000. Ethereum has also seen a slower recovery, reclaiming the $2,500 price level but not advancing much further despite positive ETF inflows in the United States.
